What we can learn from the people of Richmond
Recent research has revealed that the people of Richmond are the best savers. Harvey Jones explains more...
Saving is supposed to be a dying art form. We lost the knack during the boom, when it seemed wiser to borrow all the money we could, and use it to buy stuff, primarily property.
Then came the bust, and everybody desperately wanted to save again, or at least pay down our debts, only to find we had forgotten how, and didn’t have the money anyway.
There didn’t seem much point either, given the pitiful rates paid on savings accounts. Savers were the whipping boys of the financial crisis, called upon to bail out reckless bankers and feckless borrowers.
So it’s amazing we still do it at all.
It’s a regional thing
And yet we do. The average savings balance across the UK is £6,074, according to new figures from Halifax. That kind of money comes in handy, or it would, if it was evenly spread. Unfortunately, that national figure hides a wealth of local differences, between those who can save and those who can’t. Some very big differences.
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I’ve been to Richmond-upon-Thames, and it’s a nice place. Well-heeled, you might say. It is also home to the nation’s best savers. Residents in the TW10 6 postal area have the highest average savings balance in the UK, a hefty £29,765.
You might say, ah well, it’s a London thing, but that’s not the case. It is 380% above the average for London, where the average savings balance is £6,211, only marginally above the national average.
Skinheads to skinflints
Obviously, it’s a money thing. The area around Richmond Park is pretty posh. I wouldn’t say people have money to burn, but they certainly have cash to save.
It definitely isn’t only a rich southerner thing, because the second-highest savings balance can be found 400 miles north in Aberdeen, in the city’s AB15 4 postcode area. The average savings balance is £26,130, a mighty 350% above the average balance for Scotland.
Just three other postal areas have average balances above £20,000, and again, it’s a London and Scottish thing, with Putney SW15 6 (£22,557), Edinburgh EH12 6 (£22,158) and Stanmore (£20,894).
Stanmore surprised me most. I remember being chased around the local tube station by a gang of skinheads in the early 1980s, and swore I’d never go back. Maybe I should, now that the locals have grown their hair and adopted a sensible attitude to banking.
Here are some other towns with big saving postal areas: Banchory, Harrogate, Christchurch, Woking, Hove, Macclesfield, Eastbourne, Twickenham, Loughton and Glasgow.
If you live in any of those, you’ve got serious savings competition on your doorstep.
Out of the top 50 postal savings areas, Greater London comes top with a total of 19, followed by the South East and Scotland with 12 each. So I was right last year when I said we should all Save like a Scotsman. Or a Southerner, for that matter.
The North West (three postal areas), Yorkshire and the Humber (two) and the South West and East Midlands (one each) also figure in the top 50.
Pity the West Midlands, which doesn’t have a single postal area in the top 50 (although savers in posh parts of Rugby, Leamington spa and Malvern do their best).
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The North also does badly, apart from postal areas in Darlington, Newcastle and Durham. Also mentioned in dispatches are Lowestoft in East Anglia, Colwyn Bay in Wales, and Belfast.
Can’t save? Won’t save?
Big cities, posh towns and wealthy suburbs are the favoured places for savers to live in. No surprises there. But one thing does strike me. Once you strike out the savings hotspots, the regional differences aren’t as big as you might expect.
Yes, Greater London (£6,211) and the South East (£6,653) beat the UK average savings balance of £6,074. But Yorkshire and the Humber isn’t far behind with £5,945, nor is the North West (£5,702) or even the North (£5,581).
Who said it’s grim up north? Not so for savers.
The average savings balance in Wales is a respectable £5,905 and £5,943 in Northern Ireland. The West Midlands can muster an average balance of £5,732.
A surprising number of us can save, even if we don’t live in Richmond.
No sleep ‘til Richmond!
Nobody regrets saving money. Nobody says “I wish I hadn’t saved so much money, I wish I’d squandered the lot.” Typically, they wish they had saved more. This is true whether you live in Land’s End or John O’Groats.
You might argue that lowly interest rates give you little incentive to save, especially given spiralling inflation. But if you can lock your money away for 12 months, the FirstSave 1 Year Fixed Rate Bond will pay you 3.5% online, while Santander’s 1 Year Fixed Rate Bond will pay you 3.35% and is available via branch and phone as well.
Better still, use your tax-free cash Isa allowance, currently £5,340. The AA’s Internet Access Isa pays 3.35% on £500 above, and Santander’s Flexible Isa Issue 3 pays 3.3% on £1 and above and is available online, in branch or by phone.
Read The best place to put your savings to find out more.
These market-beating rates aren’t just available to Southerners and Scotsmen, you can get them as well. The average national savings balance is £6,074. That’s your first target.
Next stop Richmond!